4 ms·

Can someone enlighten me how SPACs differ from platforms like https://republic.co https://republic.co ? Edit: or https://wefunder.com https://wefunder.com

gen3 5y ago
Republic looks to be some form of VC funding. The whole point of a SPAC is to take a company public without filling for an IPO.
- failwhaleshark 5y ago
  So it's a "stock market" bypassing public-trading so it doesn't have to abide by SEC, SOX, etc.?
  - gen3 5y ago
    The SEC does have rules pertaining to privately traded investment. They are normally more lax than for publicly traded companies, and therefor normally require the investors be accredited. The investor is expected to preform more due diligence. https://www.investopedia.com/terms/a/accreditedinvestor.asp https://www.investopedia.com/terms/a/accreditedinvestor.asp If you are confused about how SPACs work, and the OP article didn't help, the investopedia is good https://www.investopedia.com/terms/s/spac.asp https://www.investopedia.com/terms/s/spac.asp
  - URSpider94 5y ago
    A SPAC is basically a vampire company that is publicly traded, but which has no operating business. Its sole purpose is to merge with another company, usually a private company, by expending its founding capital to buy the target. After the merger, the private company is now public - it trades on an exchange, has to file 10K’s, has to abide by Sarbanes-Oxley, etc. It’s a mechanism to take a private company public without an IPO. That’s all.
runako 5y ago
SPACs take companies public. Once a SPAC merges with a private company like SoFi or Virgin Galactic, the combined entity's shares can be traded on the NYSE or Nasdaq like any other stock. With platforms like Wefunder and Republic, there is no mechanism to take a company public.
- failwhaleshark 5y ago
  Ooooh. So it's after angels, VC, REITs, pension funds, sovereign wealth funds pass to get to "IPO" crowdfunding-style. The platforms mentioned are like crowd angels.
  - vmception 5y ago
    No, its mutually exclusive. A SPAC can transform any private company into a public company. They take VC backed companies public, they take newly formed pre-revenue companies public, they take previously public companies public, they merge with public companies, it does not matter. Its just a reverse merger with a specific structure and formula.
- deleted 5y ago
  [deleted]

gen3 5y ago

Republic looks to be some form of VC funding. The whole point of a SPAC is to take a company public without filling for an IPO.

failwhaleshark 5y ago
So it's a "stock market" bypassing public-trading so it doesn't have to abide by SEC, SOX, etc.?
- gen3 5y ago
  The SEC does have rules pertaining to privately traded investment. They are normally more lax than for publicly traded companies, and therefor normally require the investors be accredited. The investor is expected to preform more due diligence. https://www.investopedia.com/terms/a/accreditedinvestor.asp https://www.investopedia.com/terms/a/accreditedinvestor.asp If you are confused about how SPACs work, and the OP article didn't help, the investopedia is good https://www.investopedia.com/terms/s/spac.asp https://www.investopedia.com/terms/s/spac.asp
- URSpider94 5y ago
  A SPAC is basically a vampire company that is publicly traded, but which has no operating business. Its sole purpose is to merge with another company, usually a private company, by expending its founding capital to buy the target. After the merger, the private company is now public - it trades on an exchange, has to file 10K’s, has to abide by Sarbanes-Oxley, etc. It’s a mechanism to take a private company public without an IPO. That’s all.

runako 5y ago

SPACs take companies public. Once a SPAC merges with a private company like SoFi or Virgin Galactic, the combined entity's shares can be traded on the NYSE or Nasdaq like any other stock. With platforms like Wefunder and Republic, there is no mechanism to take a company public.

failwhaleshark 5y ago
Ooooh. So it's after angels, VC, REITs, pension funds, sovereign wealth funds pass to get to "IPO" crowdfunding-style. The platforms mentioned are like crowd angels.
- vmception 5y ago
  No, its mutually exclusive. A SPAC can transform any private company into a public company. They take VC backed companies public, they take newly formed pre-revenue companies public, they take previously public companies public, they merge with public companies, it does not matter. Its just a reverse merger with a specific structure and formula.
deleted 5y ago
[deleted]